Marijuana Businesses Ask Congress To Grant Them Banking Services

February 16, 2019 by Tom Ramstack
Rep. Maxine Waters speaks during a public meeting about the proposed Vermont Entertainment Village on Saturday, Feb. 10, 2018, at the Community Christian Reformed Church in South Los Angeles. (Luis Sinco/Los Angeles Times/TNS)

The lack of legal banking services for marijuana-related businesses is creating unnecessary economic barriers and encouraging crime, the owner of a Washington, D.C. marijuana business told Congress this week.

A House Financial Services subcommittee called the hearing to determine whether federal law that bans banking services for marijuana businesses should be changed.

“There is still no federally-approved system for businesses to perform typical duties like pay salaries, service customers using credit or debit cards, access working capital loans, pay bills via check, etcetera,” Corey Barnette said in his congressional testimony.

Barnette is the owner of District Growers LLC marijuana cultivation center and the Metropolitan Wellness Center Inc. cannabis dispensary, both in Washington, D.C.

“The current system serves to create a public safety disaster, disadvantages small and minority-owned businesses, hassles both employees and service providers to the industry, makes tax collection overly burdensome, and serves to largely stifle the growth of the industry,” he said.

Washington, D.C. was one of the first jurisdictions to allow both medicinal and recreational use of marijuana. Washington, D.C., along with Maryland, Colorado, Washington state and Oregon, also allows retail sales of small amounts of the drug.

Possession or sale of marijuana remains a felony offense under federal law.

Several witnesses from among state economic agency and trade association officials said the federal government was out of step with state laws. There are 47 states that legalized some degree of marijuana use, mostly for medicinal purposes.

California State Treasurer Fiona Ma told Congress the marijuana industry would be worth at least $5.1 billion in her state by 2020.

Congress is considering legislation called the Secure and Fair Enforcement Banking Act of 2019, also known as the SAFE Banking Act, that would turn cannabis into more of a regular business. The hearing this week was the first in Congress to consider banking services for marijuana businesses.

The bill would prohibit federal banking regulators from penalizing financial institutions that deal with legitimate marijuana-related businesses. The businesses could then accept credit cards from customers, obtain lines of credit for loans and pay employees through bank accounts.

Federal law now forces businesses that sell marijuana to deal with cash transactions only, sometimes making them targets of armed robbers.

Neill Franklin, a former Maryland law enforcement officer and now executive director of the nonprofit Law Enforcement Action Partnership, said that “opportunities for cash robberies will increase” as more marijuana businesses open but must deal only in cash.

One example witnesses mentioned during the hearing was the case of Travis Mason, a security guard who was shot and killed during robbery attempt at a marijuana dispensary in Colorado on June 18, 2016. He was planning to become a police officer when he was killed by the two robbers.

Witnesses also warned that the marijuana businesses could be used to launder money from illegal activities if all their transactions are in cash.

The American Bankers Association said in a statement to the subcommittee that federal law is standing in the way of economic development in states that legalized marijuana.

However, Jonathan Talcott, chairman of the anti-marijuana legalization group Smart Approaches to Marijuana, said ingesting the drug can lead to psychosis, addiction and serious health problems.

“This is a public health issue, not a banking issue,” he said.

Economy

Industry Analysis Finds Trump’s War Restricts Solar Energy Job Growth
Employment
Industry Analysis Finds Trump’s War Restricts Solar Energy Job Growth
February 19, 2020
by Dan McCue

President Donald Trump's tariff war with China significantly restricted the growth of the nation's solar energy workforce last year, an industry analysis shows. According to a report released Wednesday by The Solar Energy Foundation, a nonprofit, nonpartisan organization dedicated to advancing the use of solar and... Read More

Fed Chair Tells House Panel Coronavirus Risk to US Economy Still Unknown
Federal Reserve
Fed Chair Tells House Panel Coronavirus Risk to US Economy Still Unknown
February 12, 2020
by Dan McCue

WASHINGTON - Federal Reserve Chairman Jerome Powell told a House panel on Tuesday that while the U.S. economy continues to show steady growth, the broadening coronavirus outbreak “could lead to disruptions in China that spill over to the rest of the global economy.” Powell offered his... Read More

Decline in New Jobs Hints at Weakness in Otherwise Healthy Market
Employment
Decline in New Jobs Hints at Weakness in Otherwise Healthy Market
February 11, 2020
by Dan McCue

WASHINGTON — Businesses across the U.S. cut back in the number of new job openings they advertised in December, the Labor Department reported Tuesday. The pullback, following a similar decline in November is seen by some economists as a sign that the hot job market may... Read More

Pompeo Warns Governors to Be Wary of China's Economic Overtures
State News
Pompeo Warns Governors to Be Wary of China's Economic Overtures
February 10, 2020
by Dan McCue

WASHINGTON -  Secretary of State Michael Pompeo delivered a stern warning about China in a speech to governors on Saturday, warning that Beijing is using economic promises as a wedge to exploit U.S. vulnerabilities. "The competition with China is not just a federal issue," Pompeo said... Read More

White House Says China Guilty of 'Massive' Intellectual Property Theft, FBI Vows Crackdown
In The News
White House Says China Guilty of 'Massive' Intellectual Property Theft, FBI Vows Crackdown
February 7, 2020
by Kate Michael

WASHINGTON - National Security Advisor Robert O’Brien told a gathering of world ambassadors this week that China has engaged in a "massive theft" of Intellectual property from the U.S., complicating diplomatic relations and making events like the recent trade dispute between the two countries more difficult... Read More

Trump Signs USMCA, Declaring an End to 'the NAFTA Nightmare'
Trade
Trump Signs USMCA, Declaring an End to 'the NAFTA Nightmare'
January 29, 2020
by Dan McCue

WASHINGTON - President Donald Trump signed the new North American trade deal into law on Wednesday, declaring an end to "the NAFTA nightmare" and the beginning of a "glorious future." During an outdoor signing ceremony at the White House, Trump said, "This is a cutting-edge, state-of-the-art... Read More

Straight From The Well
scroll top